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Upholstered Domestic Seating: New Dumping Complaints on the Horizon?

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Canada’s furniture industry was seemingly upturned in late 2020 with the Canada Border Services Agency (“CBSA”) investigation and then its Notice of Preliminary Determination that certain upholstered domestic seating (“UDS”) being imported to Canada from China and Vietnam was being dumped.  Almost overnight, it seemed, the cost of Canadian leather sofas and recliners skyrocketed (some under dumping and subsidy duties set as high as 188%) – with CBSA’s imposition of provisional and then final anti-dumping duties, levied under Canada’s Special Import Measures Act (“SIMA”), being to blame.   (Canadian industry might suggest NOT “to blame” BUT to “protect”, Canadian competitiveness that is).

On September 2, 2021, the Canadian International Trade Tribunal (“CITT”) announced that it agreed with the CBSA, concluding that dumping existed and material injury had occurred. 

This then led to our current system forcing importers to either purchase at normal values assigned to specific exporters and manufacturers, or pay attendant anti-dumping duties.

What is Going on Now?

The current UDS order will expire on September 1, 2026, but not before the CITT conducts an Expiry Review.  Expiry Reviews generally begin a one to four months before the expiry of the prior order, with the focus of the Expiry Review being on whether the expiry of the current order would likely lead to the continuation or resumption of dumping and/or subsidizing.  Where “yes”, the order is usually renewed.  Where “no”, the order is allowed to expire.

That said, a few other things are happening currently, the last of which is the most interesting.

First, a number of exporters have sought Expedited Reviews from the CBSA regarding their UDS products.  Expedited Reviews allow CBSA to review normal values, export prices and amounts of subsidy for goods or a particular exporter, that was not previously asked to submit information in a proceeding.

Second, CBSA has also conducted a number of Normal Value reviews since 2022.  Normal Value reviews also entail the CBSA considering normal values, export prices and subsidy amounts for a single exporter, but are conducted to ensure that normal values and export prices in place accurately reflect current market conditions – usually as a result of an importer filing a request for re-determination. 

Last – and this is the interesting part – there are rumours of a further industry complaint forthcoming, this time involving stationary fabric UDS (“SFUDS”).

New Industry Complaint Coming on Stationary Fabric UDS?

Recently reported publicly, it appears that there may be an industry group trying to organize various Canadian furniture manufacturers to formalize a complaint to the CBSA regarding an investigation into dumping of SFUDS, which could bring into the fray items like stationary fabric sofas and dining chairs imported from China and Vietnam.

If this rumour is correct, this would be an interesting development, as it would see the Canadian industry specifically targeting the very UDS products that were expressly excluded from the original complaint and anti-dumping orders. 

It seems that if a complaint is to be made, the target date for that will be late summer / early fall 2024!

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